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(Full description) It is designed to keep you "knowledgeable and competent" in accordance with ESMA's Guidelines (details) to implement MiFID II. We update you on EU-level developments in regulation, market structure, economic figures and events that may influence investment products marketed by your firm. This is NOT investment research attempting to forecast security prices.

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We select articles from our database to produce a a "10-minute Read 'n Verify" e-mail of about 1500 (normal maximum 2000) words of content per week. Each article has a link that enables you to drill down into more detail - depending on your corporate subscription level. Moreover, you can browse our website - subject to your subscription - to broaden your understanding of a subject. or set up a personalised alert.

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The Verify test enables you to check your comprehension of our choice of the top three issues this week.

• ESMA produces first overview of EU derivative markets size
• ECB: Report on financial structures shows ongoing consolidation in the banking sector
• Financial Times: European banking union needs its final leg

At the foot of this e-mail is a link to a multiple choice test and you can use a "100% success" on the three questions to verifiy 10 minutes of CPD to your employer and/or professional qualification body.

Jump directly to articles on:- Banking Union Capital Markets Union Clients Union Insurance Asset Management Corporate Governance/Accounting Financial Services Policy Economic       About this email

Articles from 19 October 2017 - 26 October 2017

Banking Union     ECB: Report on financial structures shows ongoing consolidation in the banking sector The number of credit institutions in the euro area banking sector declined by 25% between 2008 and 2016, according to the ECB’s 2017 Report on financial structures (RFS). On an unconsolidated basis, the number of credit institutions at the end of 2016 was 5,073, having fallen from 5,474 at the end of 2015.   View Article Final guidelines on identification and management of step-in risk issued by the Basel Committee The Basel Committee released the final Guidelines on identification and management of step-in risk. Step-in risk refers to the risk that a bank provides financial support to an entity beyond, or in the absence of, its contractual obligations should the entity experience financial stress.   View Article Financial Times: France balks at reforms that will standardise banking rules At the heart of a dispute over the post-crisis Basel III rules is the so-called output floor, which limits the extent to which banks can use their own models to calculate the riskiness of their lending.  View Article BIS: Fifth BCBS-FSI-BSCEE high-level meeting on supervisory priorities in Europe Fifty-two senior representatives from 30 European jurisdictions discussed topical banking regulatory and supervisory issues such as proportionality in banking regulation; identification, measurement and resolution of non-performing loans (NPLs); implementation of the post-crisis banking resolution framework; and regulation and supervision of cybersecurity.  View Article ALFI response to European Commission consultation on non-performing loans ALFI responded to European Commission consultation on the development of secondary markets for non-performing loans and distressed assets and protection of secured creditors from borrowers’ default.  View Article Financial Times: European banking union needs its final leg The first two legs — the Single Supervisory Mechanism and the Single Resolution Fund — have been realised, but one is still missing: the European Deposit Insurance Scheme (EDIS). Several proposals for the third leg have been put forward, but little progress has been made.   View Article ECB: Results of the October 2017 euro area bank lending survey Increasing demand and eased lending conditions support loan growth. The ECB’s APP facilitates an easing of credit terms and conditions. Negative deposit facility rate has a positive impact on lending volumes.  View Article European Parliament: Draft RTS on valuation before and following resolution under Articles 36 and 74 of the BRRD This briefing has been drawn up to support ECON’s work on the scrutiny of delegated acts, in particular as regards the discussion on two draft European Banking Authority Regulatory Technical Standards on valuation under the Bank Recovery and Resolution Directive.  View Article Deutsche Bundesbank's Dombret: Sometimes small is beautiful, and less is more - a Small Banking Box in EU banking regulation Andreas Dombret outlined how the current regulatory regime of complex rules that governs virtually all banks in the EU came into being. He also laid out a solution for the EU's banking sector: the Small Banking Box - a separate set of rules for smaller, locally oriented, and less risky institutions.  View Article Financial Conduct Authority outlines lessons learned in year one of its Regulatory Sandbox The FCA has published a report outlining how the regulatory sandbox has met its objectives over the first year of operation. The sandbox was established to support the FCA’s objective of promoting effective competition in the interests of consumers.   View Article     Capital Markets Union     ESMA produces first overview of EU derivative markets size ESMA produced, for the first time, data on the size of the interest rate, credit, equity, commodity and foreign exchange derivatives markets in the EU, based on the weekly data it receives from trade repositories TRs.  View Article AFME’s response to European Commission’s proposal for a regulation amending EMIR The position paper states that particularly in the domain of OTC derivatives, robust and efficient clearing services enhance the safety of the risk reducing transactions undertaken by real economy corporates and investors.  View Article Financial Times: MiFID asks more questions than it’s meant to answer Under MiFID II, banks and brokers will no longer be able to include, or “bundle”, the cost of research with other services they provide to investors, to avoid any suggestion of conflicts of interest. The nub of the problem is who pays and how much.   View Article European Parliament briefing: Securitisation and capital requirements As part of its ambition to create a Capital Markets Union, the European Commission wants to revive the securitisation market in the EU, in order to offer new financing tools and ease credit provision, especially for small and medium-sized enterprises.  View Article ECB: September 2017 survey on credit terms and conditions in euro-denominated securities financing and OTC derivatives markets Survey respondents reported that, on balance, credit terms offered to counterparties in both securities financing and over-the-counter (OTC) derivatives transactions over the three-month reference period remained basically unchanged.  View Article ESMA updates its Q&A on Prospectuses ESMA updated its Questions and Answers Document on prospectus related issues.   View Article     Clients Union     Commercial Risk Europe: Risk managers welcome Commission moves to boost cybersecurity and data flow Ferma and leading member associations have welcomed wide-ranging measures proposed by the European Commission to beef up cybersecurity in the EU and facilitate free flow of non-personal data across the bloc to create a digital single market.  View Article     Insurance     Commercial Risk Europe: EU-US covered agreement may take five years to fully implement, says Best The ‘covered agreement’ between the US and the EU provides regulatory clarity and reduces the regulatory burden for US and EU reinsurers operating in each other’s markets, but full implementation may take five years, according to AM Best.  View Article PRA launches series of improvements to the implementation of Solvency II The PRA published the first in a short series of consultation papers on reform to the implementation of Solvency II starting with the Matching Adjustment (MA).  View Article     Asset Management     EIOPA receives request on costs and past performance of IBIPs, personal pension products and defined contribution pension schemes The EIOPA and the other two European Supervisory Authorities have received a request from the European Commission to issue recurrent reports on the cost and past performance of the main categories of retail investment, insurance and pension products.  View Article Investment & Pensions Europe: Supervisor EIOPA overstepping mark with PEPP, conference hears The pensions industry is growing concerned about the European regulator’s role in the creation of a new retirement savings product.  View Article Investment & Pensions Europe: UK government backs pension dashboard project The UK government has pledged to take the lead on developing a “pension dashboard” to allow individuals to see all of their savings through one portal.  View Article     Corporate Governance/Accounting     ECA: EU Auditors publish briefing on European Commission’s fraud controls ECA has published an Audit Brief on the Commission action to reduce fraud. Audit Briefs are a new type of publication from the EU auditors that provide background information based on preparatory work undertaken before the start of an ongoing audit task and follow the announcement of the audit.  View Article CFA Institute: Revenue recognition changes The CFA Institute has published a white paper 'Revenue Recognition Changes - Key Judgments and Implementation Progress'.  View Article FRC: Auditors and preliminary announcements The FRC has published the results of a consultation on the role of the auditor in preliminary announcements.  View Article FRC: Corporate reporting standard improving, though quality not as high as it should be Whilst corporate reporting by large listed companies is generally good, detailed explanations and clarity could still be better, according to the FRC’s Annual Review of Corporate Reporting.  View Article ACCA: Professional scepticism - inside the mind of the auditor International regulator and EU experts explored the impact of cognitive biases on auditors at a recent ACCA professional scepticism roundtable in Brussels.  View Article     Financial Services Policy     EU-Switzerland Financial Regulatory Dialogue - statement The dialogue allowed for a mutual update and a general overview of regulatory developments on both sides as well as at international level.   View Article     Economic     OMFIF: Missing piece in QE puzzle Consensus seems to be building ahead of the ECB's 26 October meeting to reduce the pace of asset purchases by half to €30bn per month for at least nine months.  View Article

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